A time capsule of the greatest financial mania in the history of mankind, told in real-time by regular folks and patriots. May future generations better understand the madness of crowds, and how power and money corrupt.

March 15, 2008

OK, I'm only gonna say this once, so sit down, grab a pillow, get comfy, here it comes....

I support what George Bush had to say today about housing.

Gag. Cough. Hey, what's that in the window - oh, dear, it's a pig.

Seriously, we may be having an impact here. I think George Bush and Karl Rove have just stumbled on a winner, thanks to HP and sites like ours.

The majority of America doesn't want to see a Hillary-Clinton-style housing gambler bailout.

The majority of taxpaying Americans don't want to have taxpayer dollars going toward propping up home prices.

The majority of Americans have come to see the housing bubble for what it was, and accept that prices need to come back down.

And future potential GOP voters - renters, young adults, immigrants, etc - would be penalized if the government stupidly tries to prop up stupid home prices!!!!

Well I'll be damned. Great. Wonder what took 'em so long. Now let's see if they can hold the line, and veto any sh*t that comes from our corrupted Congress.

Here's Bush, still The Worst President Ever, pulling his head out of his ass long enough to see the light on housing. Thanks Mark for the tip:

Some in Washington say the government should take action to artificially prop up home prices. It's important to understand that this would hurt millions of Americans.

For example, many young couples trying to buy their first home have been priced out of the market because of inflated prices. The market now is in the process of correcting itself, and delaying that correction would only prolong the problem.

My Administration opposes these proposals. Instead, we are focused on helping a targeted group of homeowners — those who have made responsible buying decisions and could avoid foreclosure with a little help.

I'm not enthusiastic about a Federal bailout of people who got in over their heads, either. However, the fact remains that so many people have abandoned their houses that in many sections of the country the vacant housing is becoming an overwhelming problem for local governments. And despite the rhetoric coming out of the Bush Administration about their jawboning lenders to work with those in default, what I'm reading indicates that few lenders are showing any forbearance. For one thing, there is no longer a direct connection between the original lender and the borrowers thanks to securitization. And last and certainly not least, Hank Paulson's Goldman Sachs by cynically shorting mortgage backed securities while they were selling them to clients, have profited immensely from a collapsing housing market.

Game it out folks. Why would BushCo and the GOP switch directions, and instead of their "Hope Now" bullsh*t, and all this talk about bailing out the housing gamblers, now they're saying "if you overcorrect you go into a ditch"

Something changed.

Here's some bonus thoughts:

1) they found HP

2) their internal polling showed that attitudes have changed and people don't want taxpayer money used to bail out house prices

3) they remembered Terri Schiavo

4) They're focused on bailing out the banks and investors, and will screw the little guys, especially the minorities and low-earners who were the last ones into the housing ponzi scheme (i.e. democrats)

5) They've come to understand that hte problem is so massive, that there's no way they could afford a bailout of homedebtors

6) They're being shown the door anyway, so might as well do what's right even if it's not popular

Gotta be something to this. In the history of this blog, I think this is the first time I've agreed with Bush

I was shocked to read this in the morning as well. Only time I'll ever agree with Bush. Now I'm just waiting for prices to drop here in Canada. I've got alot of nice neighbourhoods I'm considering buying in :)

Agree with Keith's #4 = bailing out banks, stockholders and Wall Street, and screw the "late to the party" buyers (who were a lot of working class white people and minorities). . .- on the ground here in SD County - rich Republican neighborhoods like Rancho Sante Fe or La Jolla have lost all of 5% on housing prices, while Chula Vista a working class area is foreclosure capital and losses there are approaching 50% in some neighborhoods.

Most rich Republicans are older, probably bought their house in 1980 or 1975 and have seen the value go from 200K to 2 million! If they "loose" a few hundred K in value, they don't really care. They are also getting low property taxes under prop 13 - so they are likely paying $3000 a year on a two million dollar house, while those who bought a stucco shitbox for 500K pay $6000 a year in taxes. . .so, Bush's "people" want their stocks and bonds bailed out, but don't want Chula Vista or Cleveland, Oh bailed out.

What the federal government and the bush cronnies coalition needs to do is increase the renewable energy rebates so that we can continue to develop more green infrastructure into our communities and become independent of oil at $110/ per barrel. To learn more about solar rebates, industry info and research check out www.solargreendna.com

If abandoned houses are a problem, prices should be lowered. Then people will buy and move into the houses.

If local governments are hoping prices will stay where they are, then they deserve the problems they are having.

A party that calls itself "Democrat" is advocating a policy which will keep house prices unaffordable for working people, mostly for the benefit of financial institutions who should have known better, during an election year! Amazing.

Any bailout at this point only tricks the recipients (FB'er)in to thinking they can afford their overpriced depreciating asset for for a few more years and to continue making worthless (and unnecessary) payments to the banks. This is a bank subsidy.

It is in the best financial interest of the FB's to mail their keys back to the banks now, do not delay. Let the market correct already!

Anyway, I sure as hell don't want any of my money subsidizing FB'ers or banks.... they need to work it out amongst themselves.

Game it out folks. Why would BushCo and the GOP switch directions, and instead of their "Hope Now" bullsh*t, and all this talk about bailing out the housing gamblers, now they're saying "if you overcorrect you go into a ditch"

Something changed.

Whatever changed it wasn't Bush's idea. He doesn't have ideas, he reads what he is told to read. Quit giving him credit he isa talking head. Nothing else. What has changed is that the dominoes are falling faster than Ben can keep up. Bush gets told what to say and he says it along with a few folksy little jokes along the way and a tap dance or two.

Paulson and the real movers and shakers realize that they are screwed, so they send George out to read the lines and make everyone breathe a sigh of relief.

Wrong..his and his lackeys created and profited from this mess and now he washes his hands.You sound like the millions of American sheeple that are manipulatedby this loser of a Prez.He should be held accountable as the economic fraud and meltdown happened under his watch and made to pay the political price.You're now giving him a free pass, but the truth is no matter what the gov't tries to do with the housing bubble, there is no fix anyway, until the things play out.

Steve, if people and the lending institution abandon a house and it becomes run down, the town should demand that the bank clean it it up. If it doesn't, the town should condemn and sell it (for a reasonable price). Profits for the town and a reasonably priced house for a young couple.

It's a little bit too late to indulge in any laissez fair fantasies about limiting government's involvement in the American housing industry. The whole structure of housing rests on government programs. Without the GI Bill, FHA and the rest there never would have been a push from the cities after World War II and people stepping up to their first homes, mostly in the new suburbs. And those suburbs wouldn't function without the interstate highway system that made them accessible. In 1940 two thirds of all Americans rented their homes. There is no way to disentangle government from the housing industry unless you'd like to take a real chance of triggering a total economic collapse. It's not going to happen. The practical reality is that the private sector wants government to stay out of its way when it's making money, and is eager to invite it in when it is in trouble, as is now the case. And given their track record, I think the credibility of both Paulson and his boss are about zero these days. The financial crisis we're seeing now isn't because of too much government, but because the government failed in its duty to regulate the marketplace with the tools it already has had on the books.

Keith; sure I agree no bailout for housing gamblers but on the other hand why does BushCo support a BAILOUT FOR WALL STREET...BEAR STEARNS???Why cant wall street suck it up too and raise the damn interest rates and allow the hpusing prices to correct to normal levels

I have to admit I support Bush on most issues. As person that profession is security I disagree with the left on Iraq.

But, I think either side would make a mess of this. The GOP says leave us be, then when the screw up they cry for us to bail them out. The Democrats believe in wealth re-distrobution and that means higher taxes and big govt.

We need a mix. Keep govt big enough to protect folks as much as possible but keep people motiviated.

In general I think we are in a world of crap right now and montary policy was part of that.

Democrats and Republicans both have the same goal of bailing out Wall Street. The only difference is that the Democrats pretend that they are bailing out the little guy.

It's not too late for the government to stay out of this. Any lenders who don't take care of their foreclosed property should have it taken away from them in a court order. The city can then sell the property as owner occupied only. No flippers allowed. Nothing can fix the problem of abandoned houses because there are just too many of them and they cost too much. Propping up home prices isn't going to solve anything. Anyone who cannot afford their mortgage needs to simply walk away and let the debt investors take the hit. It's not worth working two jobs or emptying out your 401k and IRA. It's not worth it wasting trillions of tax dollars to prop up prices. We need to see Bear, Merrill, Lehman, Wachovia, CountryWide and IndyMac bankrupt. We need to get rid of Citi. Their management screwed up big time and bankruptcy should be the result. Only a massive shock will bring back the needed regulation.

Re: Ranma tendo and refuse to buy overpriced: There's no question that the huge number of abandoned homes are a big problem that has to be addressed. I understand from my reading that 10% of all the houses in Cleveland are now boarded up, and there's plenty of other communities where the problem is also acute. But to imagine that the private sector alone will straighten out the mess I think is a fantasy. In many cases a genuine buyer willing and able to purchase a vacant property finds it is almost impossible to locate the current owner of the mortgage. Maybe the initial mortgage was made locally, but in most cases (especially with risky loans such as Subprime or Alt-A) those mortgages were then sold, resold and split into various subcategories of the "creative financing" that Greenspan used to think were so great. It is in many cases physically impossible for an ordinary citizen to track down who owns the place they would like to buy. And the same goes for the municipalities who have to spend money securing properties where the owner is persons unknown. I expect that the ultimate resolution will be the setup of some type of public agency that will track down ownership and secure legal title, then dispose of the property in some fair and equitable manner. I'm well aware of how badly government bureaucracies can mess up things. But I'm also fairly sure that few people want abandoned houses close to where they live, and that's true whether they are owners or tenants.

Bush will oppose the bailout of speculators but he fully approves of what the fed is doing for investment banks.

I'm glad that he's letting home prices fall back to affordable levels. But it doesn't seem right that the fed is accepting crap mortgage-backed securities as collateral in exchange for t-bills which are actually worth something.

This is like what nobel-prize-winning economist Joseph Stiglitz said of RTC, it's just a non-transparent way of re-introducing liquidity into the system by giving them money. The system needs liquidity (money) so you need to give money to someone somehow. But those who don't get money will complain about it unless you do it in a sneaky, opaque way - that's exactly what they're doing.

I hope you people from NC and PA do the right thing and vote for Hillary, after those two sick bastards slaughtered the University of North Carolina student body president, Eve Carson. This 22 years old honor student was shot several times, including once in the temple, probably while she pleaded for mercy.

You don't reinforce bad behavior by voting now for Obama, especially now that his black pastor was busted on video disseminating hatred, during his inflammatory sermons, against everyone else who's not black in America. That's the kind of church that Obama attends. If Obama patronizes that kind of message, it clearly defines his mindset. Are you going to reward that kind of behavior with your votes?

Imagine what these out-of-control punks, who're running loose in the streets, will do to your daughters attending college away from home, once Obama becomes president. Remember their general reaction to OJ Simpson's verdict? Celebration!

So you do the right thing during the primaries in PA and NC, by not rewarding classes who couldn't care less about the slaying of those innocent girls, who were treated worse than animals.

But I wouldn't be surprised with the outcome because now in America crime pays and bad behavior is reinforced. Just look at all the rappers who were pushing crack not too long ago who now have 10 exotic cars in the garage and pay $2k for a bottle of Cristal thanks to the fools who throw hard earned money at them. For those groups, commit armed robbery and murder in order to get easy money to buy Sean John sweaters is totally reasonable. and what Americas does? Votes for their candidates.

Most of the people who voted for Bush and Cheney twice are now picking Obama, including the corrupt MSM, along with all the other blacks who are selling hatred against everyone else who's not black in the US. Do you trust them to pick your next president?

Do you trust the privileged Gen Y? Do you trust Hollywood celebs? Do you trust the ghetto that always want to be compensated by living like welfare parasites while butchering our productive and law-abiding youngsters? Do you trust rappers? Do you trust Louis Farrakahn? Do you trust the corrupt MSM who are portraying Obama as the next Messiah while giving him a free pass on all the shady stories?

These are the groups picking your next president...and you're letting them, as usual.

W's overlords will change his stance in the name of helping out the little guy. But really it will be a bailout for America's finance industry.

I agree. It's all in the wording and delivery, IMO. The goverment will step in. RTC II will be called the U. S. Government Housing Renewal Corporation or some other bullshit name, but it will still basically be the RTC II/government bail-out, IMO. Congress will have their little paws in it too, trying to take credit for helping the "struggling" homeowner. All the while, bankers, homebuilders and Wall Street will be snickering in the corner, stuffing their pockets with goverment money.

It's election year, and EVERY politician in Washington D. C. is trying to "one-up" the opposing political party. Bush and co. will do anything to make McCainker sore look good. And, there's nothing more than Congressmen and Congresswomen like better than to keep their sponge jobs.

Bush may talk that talk now, Keefer, but whenever there is a recession and national elections in the same year, then "double-speak" becomes the mandatory language of politicians.

Still drinking the Obama's Kool-Aid or are you just an irrational Clinton Hater?

Rezko's role bigger than admitted

Barack Obama on Friday acknowledged that he had substantially underrepresented the cash raised for his earlier campaigns by indicted businessman Antoin “Tony” Rezko.

But Obama's campaign said it could not donate to charity as much as $90,000 in newly acknowledged Rezko-linked contributions because the old campaign accounts were closed and the money spent.

Obama's acknowledgment that Rezko raised as much as $250,000 for earlier campaigns, initially made in an interview with The Chicago Tribune and confirmed later to Politico, came after a year-and-a-half-long trickle of admissions about Rezko’s fundraising role and more than a month after Obama’s aides contended that they had identified and jettisoned all Rezko-linked cash. It also came as Rezko’s trial on corruption charges, underway in Chicago, brought increased scrutiny of Obama’s ties to the real estate developer, fast-food magnate and political insider.

LaBolt also said the campaign would release new information about a much-scrutinized land deal between Obama and Rezko’s wife, which Obama has called a “boneheaded” mistake.

A Politico analysis of campaign finance and court records found Rezko’s fundraising for Obama extended well beyond the confines of the initial list and overlapped with contributions prosecutors plan to highlight in Rezko’s trial in federal court in Chicago.

The review turned up donations previously unnoted by media and Obama’s campaign. And it found a pattern in which, on at least seven occasions, groups of five or more Rezko associates and workers would on the same day write big, often matching checks to Obama’s campaigns, starting with his failed 2000 congressional race.

Here's an excerpt taken directly from the church run by Obama's pastor, Wright, who hates everyone who's not black in America, just like all the Muslims hate us:

The Pastor as well as the membership of Trinity United Church of Christ is committed to a 10-point Vision:

4. A congregation with a non-negotiable COMMITMENT TO AFRICA.

9. A congregation committed to RESTORATION.

10. A congregation working towards ECONOMIC PARITY.

This is the same pastor who was caught on video spreading hatred against EVERYONE who's not black in the US, and who married Obama and Michelle and baptized their two daughters. They both attend that church frequently, so you know why Michelle Obama says that she's not proud of the US, while earning more than $300k per year to do nothing (favor job from Senator Obama's cronies).

You can assume that those points will be followed by Obama if president, so prepare yourselves to pay a lot of taxes to support Africa and provide more welfare to all those parasites who slaughter female students at universities, like the 22 year-old Eve in NC.

Obama will turn this country into a welfare haven for blacks, Muslims, and Africa, at your expense. That's why Obama's only bill in the Senate to date was a $1 trillion donation to Africa funded by hard working taxpayers. Obama's following the orders from his nutcase pastor who said that the US created AIDS virus to kill blacks. Tha Obama bill is part of those 10 points, RESTORATION and PARITY by taking money from people who actually work for a living and giving away to violent parasites.

Do you want your next president to be listening to this kind of adviser?

I guarantee that you'll be working a lot harder to pay higher taxes and support all those welfare parasites who breed like flies, factories of criminals who slaughter your daughters who are away in college (i.e., Eve Carson in NC). You can go to the website and check for yourself if you don't believe me:

But it doesn't seem right that the fed is accepting crap mortgage-backed securities as collateral in exchange for t-bills which are actually worth something.

It's not a trade, they still have to pay it back. The FB's already got their bailout by being able to walk away with no tax consequences.

Who are the victims? Nobody. The FB's put zero down and got to live in a house they couldn't afford with a negam loan. Now they are going back to renting where they were before. Some of them even got to pull out equity. Tell me again how are they being victimized?

IMO the regulations should have been in place to prevent the whole thing, but anyone with a brain knows that the Fed isn't going to let the entire banking system fall apart. There will be no food, water, medicine, utilities or anything needed to survive. Is that what you really want? Do you have enough food and ammo to save yourself, your relatives and friends?

Justice would be if these CEO's were lynched on Wall Street lamp posts

Representatives from the IRS, the Metro police department, the FBI, the U.S. Attorney's Office, the Attorney General's office and the U.S. Department of Housing and Urban Development announced the indictment of a local couple as the task force's first case.

Eve Mazzarella, a 30-year-old real estate broker who promotes herself as a rags to riches success story and her husband Steve Grimm face charges for bank fraud, aiding and abetting and money laundering.

Investigators believe the couple used bogus buyers to purchase more than 200 homes on their behalf at inflated prices.

"The alleged scheme involved $100 million in loans with much of the proceeds being diverted to the defendants for their own personal use and benefit and not for the purposes the proceeds were intended," said Gregory Brower, U.S. Attorney for Nevada.

More than half of the homes involved went into foreclosure. Officials say this scheme is just one of many permutations that impact the real estate market and cost taxpayers billions of dollars every year.

"It's like credit card fraud. We all pay a little bit more in terms of our credit card bills because of credit fraud, the same thing is true of mortgage fraud. We're all victims," said Brower.

Here's how it should go: If the owner of the house cannot be easily identified, the town should send a letter to whatever name is on the deed and advertise in a local and a national paper for thirty days that it is going to seize the property if the owner does not step forward. If whatever bank or group of banks that owns fractional shares does not show up, they forfeit their rights. If a bank shows up that owns 10% of the house, they then get 10% of the condemned value, minus 10% of administrative costs for the effort it took to find them. If a bank shows up that owns 100%, they get to pay the full administrative costs and get fined each day that they do not keep the house up to code. Banks should be treated as harshly as a homeowner would be if s/he decided not to keep the house in reasonable condition.

Oh dear, we can't have empty houses, and it's sooo hard to find the owners, so let's turn it all over to the feds even though we know they'll screw the pooch every time!

And it will be just fine when poor people pay for it all through higher income taxes (the 10% rate is going to 15%) and the most regressive tax of all - inflation. Is there any problem for which you idiots don't envision a government "solution"?

If we leave things alone, the free markets can solve this problem in less than a year. It will take the government 5-10 years to do the same thing. There will be terrible pain and dislocation but unlike your "shared pain" nonsense, the people suffering will be the flippers, fools, and lenders who pandered to them. House prices will be reset to true market levels and we can all get on with life again.

Anonymous Anonymous said... yea, sure, suck it if you are of average net worth. But hey, the us tax payer will bail investment banks for the rich. March 15, 2008 5:20 PM------------------------------------Thats the way I see it too. Socialism for the Banks. You average folks can just go get a 2nd or 3rd job.

I don't care why he said this. I'm just thanking God he said it and praying he sticks with this line of thought.

He actually sounds like a rational, thoughtful person here. Will wonders never cease.

Steve- it was Clinton admin. that dismantelled the Glass Steagel banking regulations in the 90's. Glass Steagel was put in place during the Depression to ensure that what happened back then would never happen again.

Clinton started the Housing Bubble by getting rid of Glass Steagel and then getting rid of capital gains under 250K (single) and 500K (couple) for sale of house. (At a time when homes, even in pricey West Coast cities could be had for under 200K!)

The bubble kicked off in a massive way in the West Coast tech cities in the 90's as a direct result of these changes by Clinton. Then the Bush admin. carried the whole mess forward. And NOBODY in Congress ever demanded over the past decade that the Federal Reserve DO THEIR JOB and regulate the banks.

I made all cash offers on two seperates foreclosures owned by Well Fargo in the Inland Empire of SoCAl. One house was severlay vandalized, empty for months and attracting crack addicts to the neighborhood. They refused my offer without even a counter. Two months later the REaltor tells me they turned down an offer that was double mine.

The other proerty had been empty for 6 months, same thing, all cash fair offer Wells replies with simple no w/o a counter.

Foreclosures are stacking up like crazy around here. There are buyers out there but the banks have another plan. What it is I don't know.